The government has reinstated the tax exemption for Grameen Bank for the next five years, extending it until December 2029.
This was confirmed by the National Board of Revenue (NBR) in a gazette issued on Thursday.
Grameen Bank, founded by Nobel Laureate Prof Muhammad Yunus, who currently serves as the chief adviser of the interim government, has benefited from tax exemption since its establishment in 1983 due to its focus on poverty alleviation.
The notification, signed by NBR Chairman Abdur Rahman Khan, said that this tax exemption is effective immediately. However, Grameen Bank is still required to submit annual income tax returns, as outlined in the gazette.
The exemption is usually renewed every five years, with the last extension having been granted until December 2020. The previous government did not renew the exemption after that period, leading to the loss of the tax waiver for the Grameen Bank.
NBR Chairman Abdur Rahman Khan told media that although it has "bank" in its name, Grameen Bank actually conducts microcredit activities as well. All microcredit institutions registered with the Microcredit Regulatory Authority (MRA) are exempt from income tax.
Since Grameen Bank was established under a special law, it does not need to register with the MRA. However, in terms of the services it provides, Grameen Bank's characteristics are similar to those of MRA institutions.
Therefore, receiving tax exemption is justifiable for Grameen Bank, which previously had this benefit.
While the approval of the national parliament is required for imposing taxes, the government can grant tax exemptions, the NBR chairman commented.
In a separate announcement, the NBR indicated that no income tax will apply to donations made to the As-Sunnah Foundation, a registered charity organization. This tax exemption will remain in effect until June 2029.
The As-Sunnah Foundation, established in 2017 by Shaikh Ahmadullah, is a non-political and non-profit organisation.
